When you’re looking for credit card processing for small businesses, it takes a little effort to begin to see what’s at stake. Because your processor is a part of every truncation that goes through your business, you want to choose the right one. One of the determinations you will need to make is whether you are interested in third-party payment processing or if you would like to set up a merchant account and work directly with a payment processor. There is much to consider when making this decision.
Third-party payment processors and payment aggregators are companies that provide interface between merchants and merchant services providers, allowing you to accept payments without setting up a merchant account. For some small businesses, this may be an appealing option, but it is important to know that there are both pros and cons to using third-party payment processors.
One of the biggest benefits of using a third-party payment processor is that account set-up is easy and fast. However, third-party payment processors usually charge higher transaction fees. On top of this, accounts are typically less stable. Additionally, one of the biggest cons of using a third-party payment processor is the lack of convenience. When using a third-party payment processor, funds can be withheld any time a processor determines charges to be fraudulent, whether or not they are. Finally, when working with third-party payment processors, customer service is typically not great. Though there are many reasons to consider using a third-party payment processor, there are also many reasons you may wish to work directly with a payment processor and set up a merchant account.
If you’ve decided to set up a merchant account and work with a payment processor, there are several things to look for. The first is PCI compliance. There are many requirements that go into making sure transactions are secure, so when choosing a payment processor, a big thing to look for is whether the processor you are working with is going to help you stay PCI compliant. In addition, you may wish to determine if the processor charges additional fees for their PCI compliance services.
The next factor may be compatibility. Does the payment processor you are looking at help you stay compatible with other software and tools for small business? It is important to consider whether a payment processor will integrate with the software you are using and may use in the future.
Finally, when considering your payment processor, you may want to determine if your processor provides fraud protection. Look into options that take efforts to increase security and protect businesses and consumers. At Moolah, while providing credit card processing for small businesses, we work with DataGuardian and Authorize.Net to offer fraud protection and even help with PCI compliance. This not only ensures you are PCI compliant but protects you from fraud, with $100,000 breach protection. Furthermore, we do so for free. A merchant account like the one offered by Moolah is a great option for many businesses and combined with Moolah’s great customer service and helpful partnerships, you’ll be ready to succeed.
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A credit card surcharge is an additional fee added to a transaction when a patient chooses to pay with a credit card. The surcharge is intended to help offset the cost of credit card processing and applies only to eligible credit card transactions.
No. Debit card transactions may not be surcharged under any circumstances, even if the debit card is processed as a credit transaction or entered manually.
Yes. Credit card surcharges may not exceed the merchant’s actual cost of accepting credit cards and are capped at a maximum of 3% of the total transaction amount, in accordance with card-network rules and applicable law.
Yes. Card networks require clear and transparent disclosure of any credit card surcharge. Practices must notify patients through appropriate signage at the practice entrance, point of sale, and anywhere payments are accepted. If payments are accepted online, the surcharge must also be clearly disclosed on the practice’s website.
Yes. Some U.S. states and territories prohibit or restrict credit card surcharging. Practices are responsible for understanding and complying with their state’s specific requirements before implementing a surcharge.
No. While Moolah provides tools and general guidance to support credit card surcharging, compliance with all applicable laws and card-network rules is the responsibility of the merchant. Moolah does not provide legal advice and assumes no liability for a merchant’s compliance.
Most major credit card networks permit surcharging when done in accordance with their rules, but additional requirements or restrictions may apply. Practices should ensure they have completed all required network notifications and disclosures prior to enabling surcharging.
Failure to comply with surcharging rules may result in card-network fines, required refunds, or other enforcement actions. Practices should ensure they fully understand all applicable requirements before applying a surcharge.
Flex does not currently offer built-in support for credit card surcharging. If a practice chooses to enroll in a surcharge plan, payments would need to be processed through Moolah’s payment platform, which is designed to support surcharging and integrates directly with Open Dental.
If you are considering introducing a credit card surcharge for your patients, it is important to understand that there are specific rules and regulations that must be followed when enrolling in and operating under a surcharge plan.
This article provides a general overview of common surcharging requirements. This content is provided for informational purposes only and does not constitute legal advice. It is the responsibility of each merchant to review, understand, and comply with all applicable laws, card-network rules, and regulatory requirements, including notification timeframes, signage requirements, surcharge percentage limits, and jurisdictions where surcharging is prohibited.
If you are unsure about the laws or regulations applicable to your practice, you should consult with qualified legal counsel. Moolah assumes no liability for a merchant’s compliance or non-compliance with credit card surcharging rules or regulations.
Transparent Communication
Card networks, including Visa, Mastercard, Discover, and American Express, require merchants to clearly and transparently disclose when a credit card surcharge is applied.
Practices must clearly notify patients of a credit card surcharge through appropriate signage placed at the practice entrance, at the point of sale or terminal, and anywhere payments are accepted. If payments are accepted online, surcharge disclosures must also be clearly visible on the practice’s website. All disclosures must inform patients that the surcharge applies only to credit card transactions.
Surcharge Limits
Credit card surcharges must comply with both card-network rules and applicable law. The surcharge amount may not exceed the merchant’s actual cost of accepting credit cards and may not exceed 3% of the total transaction amount.
Card-network rules cap credit card surcharges at 3%, meaning that if a merchant’s processing costs exceed this amount, the excess portion cannot be passed on to the patient.
Network and State Restrictions
The major credit card networks, such as Visa and Mastercard, impose specific requirements related to surcharge limits, advance notification, and disclosure.
In addition, several U.S. states and territories regulate or prohibit credit card surcharging. At the time of writing, credit card surcharging is prohibited in Connecticut, Maine, Massachusetts, and Puerto Rico. Other states, including Colorado, Minnesota, Mississippi, New Jersey, and New York, impose restrictions on surcharge amounts or require specific disclosures.
If your practice operates in a state that restricts or prohibits credit card surcharging, you must fully understand and comply with those requirements before implementing a surcharge.
Debit card transactions may never be surcharged, even if the debit card is processed as a credit transaction.
Applicability
Credit card surcharges may be applied only to credit card transactions. Other payment types, including debit cards and alternative payment methods, are not eligible for surcharging.
Regulatory Compliance
Merchants are responsible for maintaining ongoing compliance with all applicable card-network and legal requirements. This includes meeting advance notification obligations, using compliant signage and disclosures, adhering to surcharge percentage limits, and respecting jurisdiction-specific restrictions.
By following these guidelines, dental practices can implement credit card surcharging in a way that aligns with card-network rules and promotes transparency with patients. Clear and upfront communication helps maintain patient trust and supports a positive payment experience.